Hedging Bets
Hedge one's bets Lessen one's chance of loss by counterbalancing it with other bets, investments, or the like. For example, I'm hedging my bets by putting some of my money in bonds in case there's another drop in the stock market. This term transfers hedge, in the. Hedging a bet is an advanced strategy used by sports bettors to either reduce the risk of a wager or to guarantee a profit of some kind from a wager. Similar to middling a wager, hedging is a strategy that involves placing wagers on the opposite side of your original bet. As futures bettting has become more popular, so has hedging. The hedging technique has NOTHING to do with pricing discrepancies in the betting markets. As we mentioned earlier, the key to this technique is that we use it for existing wagers. The idea is simply that we back alternative outcomes when we want to change our position from a previous wager. If it was a grand, you'd hedge another grand to only take out 150$? If it was a buck (100$) you'll get 15$. But I'm sure you already knew that. My problem with hedging is that sometimes, books will return your initial wager with a message in your inbox 'placed bet on unconfirmed odds', which is usually in their T&C. Seen it happens more than once. Hedging your bets is a betting strategy which involves placing bets on a different outcome to your original bet to secure a guaranteed profit regardless of the result, or reduce your risk on a market. For example, hedge betting can be applied to reduce your risk when the odds have: Shortened after an initial lay bet.
In life, when someone hedges a situation they are limiting their exposure to the downside. In day to day life, someone can hedge many things.
When someone hedges in sports betting they are limiting their exposure to a potential financial loss. Hedging a bet is an advanced strategy used by sports bettors to either reduce the risk of a wager or to guarantee a profit of some kind from a wager.
Similar to middling a wager, hedging is a strategy that involves placing wagers on the opposite side of your original bet. As futures bettting has become more popular, so has hedging. New sports bettors might have heard about the sports betting risk management strategy in mainstream media.
If nothing else, hedging a bet has become a popular discussion point for any occasion when a sports bettor has a futures wager pending that could result in a large win. Hedging a bet is a way to guarantee at least some kind of win.
While there’s mainstream media coverage about hedging a wager, there isn’t much mainstream information on how to hedge a bet.
What is hedging a bet?
Hedging a bet is a strategy in which a bettor will place a second wager against the original bet when they’re unsure that the outcome of a wager will be a win.
Even if a bettor thinks they might win, they could decide to hedge a bet just to be safe and guarantee they walk away as a winner. The win won’t be as large but the additional wager is a way to create some kind of insurance if the original wager loses.
Hedging is a useful strategy even though betting on all sports isn’t the same. Futures wagers are long term bets that use a moneyline. Some individual games use a point spread while betting on other sports may involve a moneyline.
A bettor can hedge against any of these types of wagers. This strategy allows the bettor to walk away as a winner or less of a loser if they choose.
How to hedge a bet
Hedging a bet isn’t difficult. However, the concept isn’t at the forefront of everyone’s mind when placing a wager. Hedging a bet is protecting some kind profit that was — and still may be — possible from an original wager.
Hedging a bet is done by placing a second wager against the original wager that will guarantee that the bettor sees some kind of profit at the end of the event. A bettor can hedge a future bet or hedge individual games. Here’s an example of hedging a futures bet:
Original wager: $100 futures bet on the New York Jets to win the Super Bowl at 60-1.
- Potential win: $6,000 + original $100 wager.
- Hedge: $1,000 wager on Los Angeles Rams to win the Super Bowl at 2-1 when they face the Jets in the Big Game.
- Best result: Jets win the Super Bowl and bettor wins $6,000. The $1,000 hedge on the Rams for safety is a loss. The total win is $5,000 instead of $6,000.
- Hedge win result: Rams win and the bettor wins $2,000. After everything, the $1,000 hedge minus $100 original wager gives a final win of $900.
- Worst result: No hedge and Rams win. $100 wager and the potential $6,000 win is completely lost.
This example shows that a hedge on a futures bet is still a profitable wager. The hedge protects the bettor from losing the entire potential profit from the wager.
Hedging a bet means the original bet isn’t as profitable as it could be. However, winning something is better than losing everything. That’s the purpose of hedging a wager.
This example also shows that everything risked (the original $100 wager and $6,000 potential win) is lost without hedging.
Some bettors don’t mind losing the $100 wager and potential profit. There are other bettors that prefer to walk away with some kind of profit after waiting an entire season.
Other times to hedge a bet
Hedging a futures bet used to be the only time this strategy was discussed. Sports betting trends in the US are changing and so is how bettors use this strategy.
In Play wagering makes it easier to hedge against an existing pre-game wager that looks shaky. In the past, bettors had to wait until the middle of a game to place a halftime wager.
Parlay betting continues to become more popular every year. Bettors are now using the hedging strategy to ensure a win. A bettor will place a hedge on the final game of a multi-leg parlay to ensure some kind of positive result from a wager.
Depending on the amount of the original wager, a bettor might choose to hedge a little so they can mitigate a loss. Losing is never fun but losing less is better than losing everything risked.
Hedging a bet is a useful tool for any sports bettor. Gambling on sports does not have to be about winning or losing a wager. There are multiple strategies to use where a bettor can guarantee some kind of profit on certain wagers.
ALSO READ: Sports Betting Lesson: When It’s Smart To Hedge Your Bet
Find the best hedging opportunities at online sportsbooks
Many gamblers are using live sports betting to hedge the bets they’ve made before the game started. This can be a useful tactic as long as bettors follow some basic principals (the basic idea is to “reduce or mitigate your risk“).
Even if you have never participated in sports gambling before, you are likely still somewhat familiar with the term “hedging your bets.”
That’s probably because this term is something of an idiom that goes beyond the world of betting. The phrase has a figurative meaning that says you are trying to reduce your potential losses on a bet or investment by counterbalancing that loss in some way.
It is essentially a way of protecting yourself from making the wrong decision, and it may pertain to facets of everyday life. Meteorologists famously hedge their bets when it comes to weather forecasting all the time, for example.
In most cases, rather than telling the public that a snow storm is sure to bring several feet of snow, they are more likely to tell us there is a percentage chance of this occurring. That way, if the storm does not bring the amount of snow they may have thought originally, they are not flat-out wrong in predicting it because they said there was a chance it may not actually occur after all.
This also takes place in the stock market and when trying to price agricultural commodities. But it also, of course, has major relevance to the world of betting.
Insurance
Hedge betting is basically an insurance policy. You’re just trying to soften the blow of a potential loss. Let’s say you placed a bet on a favorite in a given game or match, but may not be feeling particularly confident in it. You can always go place another bet on the underdog, just in case things do not work out as originally planned.
This may look silly on the surface, especially considering placing one bet on each team in a given contest is likely going to result in a guaranteed loss for you of some sort. However, there is a bit of an art to it in that it can also work to guarantee profits if things happen to break a certain way.
Hedging Bets Reddit
So, there are really two separate strategies to know.
Reduce Risk
As mentioned above, you may choose to hedge your bets if you fear losing a large amount in a bet. If you suddenly lose a bunch of confidence in your initial bet, you may decide to place a smaller bet on the opposite outcome. Examples have a way of simplifying things, so let’s try one here.
Let’s say you placed a $100 bet on the Golden State Warriors (-5.5) to beat the San Antonio Spurs. Perhaps there was some late-breaking injury news that caused you to change your mind, or perhaps it is just a gut feeling that says the Spurs will be able to pull off the upset.
In an attempt to lessen your losses if the Spurs do win the game, you place another bet on San Antonio to do just that. Assuming the game does not result in a push, you are taking on a guaranteed loss one way or the other here. On the other hand, you are also guaranteed to win the bet.
You will likely come out losing a little bit of money considering the odds are unlikely to be even, but that is an easy way to prevent a major loss. Hedging a bet means essentially punting on big winnings, unless the bet winds up being smaller than your first bet.
For example, if you lose some confidence in your first pick but still think it has a good chance of winning, this type of a bet could be a smaller risk than the initial wager. So, if you bet $100 on the favored Warriors and $50 on the Spurs and the Warriors wind up prevailing, you will still turn a profit despite reducing your risk.
Profit
You can use odds and spreads to your advantage in order to hedge bets to guarantee yourself a profit of some sorts. Even if the profit is not a huge one, winning is winning, isn’t it?
Let’s say you placed a futures bet at the start of the season on the Cleveland Cavaliers to win the NBA Finals. If they make it to the Finals, you may be able to guarantee yourself a profit by placing a wager on the opponent in the series, as well. Depending on how much you wagered in the first place as well as the odds on the Cavs and their opponent, you can wind up turning a profit regardless of the outcome of the series.
This practice is less common than hedging to try and counterbalance losses, but it can still be a useful tool if the opportunity presents itself.
What is Arbitrage Betting?
Arbitrage betting is something like a cousin of hedge betting. In sports arbitrage bet, the bettor is placing a bet on all possible outcomes of an event that guarantee a profit, regardless of the eventual result. They may also be called surewins, surebets, miraclebets or arbs, depending on where you are.
Most sporting events have two possible outcomes. The only super popular sport that includes the draw as a possible result is soccer.
Typically, you will use odds from two separate bookmakers when placing an arbitrage bet. Different sports books tend to have differing odds, so you can take advantage of any possible edge by placing one bet on each team in a given game at differing sportsbooks.
Hedging Bets Calculator
You are placing a bet on two teams in the same game, just like in a hedged bet. We can use an international soccer game as an example. English bookmakers may favor England in a given soccer game, while the nation England is facing in the game may have unreasonably favorable odds on their own team in order to create a balanced book.
In the instance that you find positive odds on both teams playing in the same game, you are guaranteed to come out with a profit no matter the result of the game.
Frequently Asked Questions
Is this something I should do often?
No, this is often a dumb strategy if you actually plan to try and make some money when betting on sports. Unless you can find an avenue that allows you to do this for a guaranteed profit, it’s most commonly used as a last resort in order to try and save yourself from losing big.
Hedging to avoid a loss is a strategy that still results in a net loss, so trying to do so as little as possible is the wisest way to go.
Is this often profitable?
Bookmakers are not lazy, so more often than not it is nearly impossible to find a margin for a guaranteed profit at the same book. There are sometimes loopholes to be found of which you may be able to take advantage, but they are rare and may be difficult to find.
In conclusion, hedging your bets is a bit of a last resort type of strategy to help you avoid big-time losses. It certainly is not something you want to make a habit of doing, but if you suddenly have last-minute dread that your initial bet may go terribly wrong, this can be a very useful tool. There are also plenty of ways for it to backfire, though, especially because the winnings from your initial bet will take a hit if it turned out your first instincts were correct.